Bouncy Bouncy

The story of a well-crafted change management initiative that keeps people and business going on the up and up at top Asian manufacturer of slab stock polyurethane, Sheela Foam

CASE FILES: IT EXCELLENCE AWARDS 2011 | CHANGE MANAGEMENT Put together a detailed plan that covers all the bases, keeps all the people informed and involved all the time, and keeps operations and business always prepared to tackle information overload-then act on it. That's what the senior management at one of Asia's top manufacturers of slab stock polyurethane, Sheela Foam Pvt. Ltd, did. And within 10 months, they were reaping in the benefits, operational and strategic, of having all the right people, technology and processes in place.

In an organisationwide initiative that ran from March 2009 through April 2010, the Managing Director of parent company Sheela Group, Rahul Gautam, alongside Sheela Foam's Head of IT, Pertisth Mankotia, and his team and partners on the business side set in place the key performance parameters for Sheela Foam and the monitoring, management and reporting systems to support and enforce them.

As a result, it "has enabled us to increase our profits and market share [and] helped us to identify the weak areas which are now the main focus areas for our improvement," Mankotia says.

Their secret? An "optimised production technique" called the Theory of Constraints put together by Israeli physicist turned business management guru Dr Eliyahu Goldratt.

Sheela Foam employs about 2,000 people in its offices and facilities across India. And before this MIS Asia IT Excellence-award winning change management project, plainly named Align Business Systems with TOC (Theory of Constraints), was done, it had a basic issue peculiar to most organisations of its size operating in a global market-that of having too many disparate systems, which typically brings with it a host of different sets of operational or business measures that often don't match and can offer up conflicting views on major performance indicators.

"There were many parameters that were used to measure business outcomes and performance, which also conflicted between departments and functions," says Mahkotia. "As such, there was a need to align all performance parameters to achieve an overall business objective, and to bring all departmental and zonal heads and their staff on one page."

And that, Mahkotia tells us, is why they adopted the concept of TOC. "One of the strengths of the TOC approach is that it provides focus in the world of information overload," he says. "It guides the organisations to improve by focusing on very few issues-the constraints to ongoing profitability. Just as the strength of a chain is governed by its single weakest link, the TOC focuses on the ability of any organisation to achieve its goal by improving its single but most important constraint."

Mahkotia and his colleagues and bosses reviewed all the moving parts of their business, applying TOC in their examination of Sheela Foam's myriad operations, functions and processes and identified four performance indicators: Throughput (TP), Operating Expenses (OE), Investments, and On Time in Full (OTIF).